Correlation Between Salim Ivomas and Dharma Satya
Can any of the company-specific risk be diversified away by investing in both Salim Ivomas and Dharma Satya at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Salim Ivomas and Dharma Satya into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Salim Ivomas Pratama and Dharma Satya Nusantara, you can compare the effects of market volatilities on Salim Ivomas and Dharma Satya and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Salim Ivomas with a short position of Dharma Satya. Check out your portfolio center. Please also check ongoing floating volatility patterns of Salim Ivomas and Dharma Satya.
Diversification Opportunities for Salim Ivomas and Dharma Satya
0.73 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Salim and Dharma is 0.73. Overlapping area represents the amount of risk that can be diversified away by holding Salim Ivomas Pratama and Dharma Satya Nusantara in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dharma Satya Nusantara and Salim Ivomas is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Salim Ivomas Pratama are associated (or correlated) with Dharma Satya. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dharma Satya Nusantara has no effect on the direction of Salim Ivomas i.e., Salim Ivomas and Dharma Satya go up and down completely randomly.
Pair Corralation between Salim Ivomas and Dharma Satya
Assuming the 90 days trading horizon Salim Ivomas Pratama is expected to under-perform the Dharma Satya. But the stock apears to be less risky and, when comparing its historical volatility, Salim Ivomas Pratama is 4.15 times less risky than Dharma Satya. The stock trades about -0.24 of its potential returns per unit of risk. The Dharma Satya Nusantara is currently generating about -0.01 of returns per unit of risk over similar time horizon. If you would invest 114,000 in Dharma Satya Nusantara on August 27, 2024 and sell it today you would lose (4,000) from holding Dharma Satya Nusantara or give up 3.51% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Salim Ivomas Pratama vs. Dharma Satya Nusantara
Performance |
| Timeline |
| Salim Ivomas Pratama |
| Dharma Satya Nusantara |
Salim Ivomas and Dharma Satya Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Salim Ivomas and Dharma Satya
The main advantage of trading using opposite Salim Ivomas and Dharma Satya positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Salim Ivomas position performs unexpectedly, Dharma Satya can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Dharma Satya will offset losses from the drop in Dharma Satya's long position.The idea behind Salim Ivomas Pratama and Dharma Satya Nusantara pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.| Dharma Satya vs. Salim Ivomas Pratama | Dharma Satya vs. Sawit Sumbermas Sarana | Dharma Satya vs. Austindo Nusantara Jaya | Dharma Satya vs. Eagle High Plantations |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
Other Complementary Tools
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Idea Analyzer Analyze all characteristics, volatility and risk-adjusted return of Macroaxis ideas | |
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Crypto Correlations Use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins |